Brown’s war on business

Gordon Brown’s claims that senior business leaders have been ‘deceived’ over the Tory plans to reverse some of Labour’s planned National Insurance Contribution (NIC) rises next year, has been interpreted as anti-business.

The Labour stance is that to ‘remove Â£6 billion from the economy’ would endanger the still fragile recovery.

The Conservatives say that minimising the NIC tax rises will reduce the tax burden on businesses and families. So supporting, not endangering, the recovery. This can be funded they claim from public sector efficiency savings.

Gordon Brown found himself on the back foot over this yesterday as 30 more business owners backed the Tory stance and the boss of the Innocent drinks factory that he visited, Richard Reed, also came out in favour of no rise in NICs.

But while the Prime Minister was being branded as ‘economically illiterate’ by business, a factor potentially embarrassing for the Tories has emerged.

Sir Peter Gershon, one of Mr Cameron’s independent efficiency experts, chairs the General Healthcare Group (GHC) which has openly said that it stands to benefit from any cutbacks that affect healthcare.

GHC has predicted in a strategy paper that the NHS faces Â£8-10 billion in cuts over three years from 2011 and that private firms such as theirs stand to gain as they step into the breach. They see an expanding role for the private sector into the future.

Gershon’s report for the Tories advocates for the increased use of the private sector in order to cut public sector cuts and drive up quality.

Although Labour may attempt to use this as ammunition, Gershon is an expert in this field and has also twice been used by Labour to advise them on such matters. So his position and thoughts will already be well known to them. There has also never been any doubt as to Sir Peter’s honesty in all of of this.

The real battle though is between whether the government should have the extra money to spend in the way it sees as good for the future of the country, or whether it is better off in the hands of business and individuals to spend as they see fit.

But also remember that with a country whose economy is measured at about the Â£1.5 trillion mark, these parties are arguing about some Â£6 billion. One wonders how much difference this figure will actually make.